MF portfolio doctor: Why Agarwal needs to increase retirement corpus to achieve financial goals


Not many investors know whether they have invested in the right funds and if their fund portfolio is on track. The Portfolio Doctor assesses the health of the fund portfolio, examines the schemes and their suitability with regard to the goals and, if required, recommends corrective measures.

The advice given is based on the performance of the funds, the risk profile of the investor as well as his financial goals.

1. Vaibhav Agarwal is saving for short and long-term goals. Here’s what the doctor has advised him:
Goals

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Portfolio check-up

  • Invests in a mix of equity and debt funds.
  • Some funds have done well but most underperformed.
  • Early start makes it easy to reach goals.
  • Holiday goal is short term. Use debt funds to save for that.
  • Other two goals are long term, so focus on equity funds.


Investment portfolio

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Note from the doctor

  • Retirement target of Rs 30 lakh too low. Will yield inflation adjusted monthly income of less than Rs 12,000 (today’s prices) for 25 years.
  • Target raised to Rs 40,000 a month (today’s prices).
  • Review investments and rebalance at least once in a year.
  • Reduce risk when goal is near so you don’t miss the target.

2. Early start, regular SIPs make it easy
Kalyani Singh is saving for his children’s education and retirement. Here’s what the doctor advised:

Goals

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Portfolio check-up

  • Investing in equity funds for past five years. Regular investing has helped amass big corpus.
  • Retirement target is low but might have other investments for the purpose.
  • Present investments are enough but hiking SIPs every year will make things easier.
  • Review mutual fund portfolio once a year.
  • Change if any fund’s performance slips.
  • Reduce risk when goal is near so that you don’t miss the target.
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Investment portfolio

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Assumptions used in the calculations

Inflation
Education expenses: 10%
For all other goals: 7%

Returns
Equity funds: 12%
Debt options: 8%



(Portfolios analysed by Raj Khosla, Managing Director and Founder, MyMoneyMantra)

If you want your portfolio examined, write to etwealth@timesgroup.com with “Portfolio Doctor” as the subject. Mention the following information:

  • Names of the fund you hold
  • Current value of the investment.
  • If you have SIPs running in any of them.
  • The financial goals for which you invested.
  • How much you need for each financial goal.
  • How far away is each goal.





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